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The Obama administration Thursday afternoon announced new guidelines that will allow financial institutions to provide services to marijuana businesses in states where it is legal. The guidelines will apply to both medical marijuana and legal marijuana states.

Some 20 states and the District of Columbia allow for medical marijuana, while two states, Colorado and Washington, have legalized marijuana commerce for adults.

Banks and other financial institutions have been increasingly unwilling to deal with marijuana-related businesses for fear of breaking federal laws. That has led to an untenable situation where marijuana businesses are forced to deal in large amounts of cash.

The guidelines were issued by the Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) in concert with the Department of Justice. Deputy Attorney General James Cole is also issuing supplemental guidance to prosecutors on how to decide whether to prosecute federal money laundering and Banking Secrecy Act violations related to legal marijuana commerce.

In a joint statement, the two departments said the guidelines will provide "greater financial transparency" in an industry where the federal government is concerned about diversion and the encroachment of organized crime. The guidelines envision financial institutions helping law enforcement with "information that is particularly valuable" by filing regular reports that can provide insight into the industry's contours.

The issuance of the guidelines is the next step in the administration's de facto acceptance of legal marijuana and medical marijuana. Last August, the Justice Department announced it would not seek to undermine state marijuana laws and issued guidance to prosecutors (the "Cole memo") telling them to lay off unless businesses or individuals were violating a set of enforcement priorities, such as diverting marijuana outside the state or making money for organized crime.

"It appears that the Obama administration is trying to provide as much protection as possible for the marijuana industry, given the constraints of federal law," he said. "The assurances the administration have provided appear fairly substantial and will hopefully prove sufficient so that banks will feel safe doing business with the marijuana industry. I have to say I'm impressed by how the White House is trying to make this work, especially given the inability of Congress to do anything constructive in this area."

So did Steph Sherer, head of the medical marijuana advocacy group Americans for Safe Access, although she called for a more comprehensive federal response.

"We have been pushing the federal government for years to make these commonsense concessions and we're pleased that the Obama Administration is finally doing so. At the same time, a piecemeal approach to medical marijuana policy is shortsighted and is an issue that deserves a comprehensive public health solution," she said.

"We will certainly be working with banks, credit unions, and credit card companies to ensure proper implementation of this federal guidance," continued Sherer. "Removing the risks of operating as an 'all-cash' business cannot be overstated, but we will also continue to put pressure on the Obama Administration to wrap these types of discrete practices into a more comprehensive medical marijuana policy."

The Washington Post has an excellent in-depth feature on the history of marijuana reform in the US, featuring interviews and pix of veteran activists Michael and Michelle Aldrich, Gordon Brownell, Dennis Peron, and others. The bottom line of the article is that prospects for reform are excellent, so much so that former drug warriors are running up the white flag.

"The momentum to treat marijuana as a legal drug is irreversible," says McCaffrey, the former drug czar. He no longer accepts invitations to appear on television to debate the issue because he says the networks "only wanted a rented idiot general who didn't understand that marijuana was harmless and filling America's jails. The opposition has gone silent. The politicians, police, judges know this is bad policy but they don't make a peep.

Sue Rusche, the founder of National Families in Action, still believes marijuana is harmful, but she has concluded that the parents' movement erred in failing to present alcohol and tobacco as the same sort of gateway drugs as marijuana. "There are a whole lot of arrests that shouldn't be happening, Rusche says, "we dont' want to see laws unfairly applied with people of color overwhelmingly being the ones arrested."

A study published by the American Journal of Epidemiology last month found that 12.2% of drivers killed by car crashes in six states tested positive for cannabinol, a marijuana metabolite, in 2010, up from 4.2% in 1999. Here is how NBC News translated that finding in the headline over a story posted on Saturday: ”Pot Fuels Surge in Drugged Driving Deaths.” The article, which begins by describing the deaths of a Colorado woman and her infant son in a crash caused by “a driver who admitted he smoked pot that day,” links the purported surge in marijuana-related traffic fatalities to laws allowing medical use of cannabis. “As medical marijuana sales expanded into 20 states,” writes health reporter Bill Briggs, “legal weed was detected in the bodies of dead drivers three times more often during 2010 when compared to those who died behind the wheel in 1999.” There are several problems with reading the trend described by this study as evidence that legalizing medical marijuana causes an increase in fatal car crashes:

The fact that cannabinol was detected in a driver’s blood does not mean he was under the influence at the time of the crash, let alone that marijuana caused the crash. “It is possible for a driver to test positive for cannabinol in the blood up to 1 week after use,” the researchers note. “Thus, the prevalence of nonalcohol drugs reported in this study should be interpreted as an indicator of drug use, not necessarily a measurement of drug impairment.”

Only three of the six states included in the study (which were chosen because they routinely do drug testing on drivers killed in crashes) have medical marijuana laws: California, Hawaii, and Rhode Island.

Traffic fatalities fell by more than 20% nationwide during the study period, even as “medical marijuana sales expanded.” Between enactment of its medical marijuana law in 1996 and 2010, California saw a 31% drop in traffic fatalities. The number of traffic fatalities also fell in Hawaii and Rhode Island after they legalized medical marijuana—by 14% and 21%, respectively.

A study published last year by the Journal of Law & Economics found that adoption of medical marijuana laws is associated with a decline in traffic fatalities, possibly because people in those states are substituting marijuana for alcohol, which has a more dramatic impact on driving ability. Briggs mentions that study in the 17th paragraph of his article.